Netflix Adds $25B To Buyback After Warner Bros Bid Fails

Earlier today, Netflix’s board approved an extra $25 billion share repurchase program, continuing capital returns, as revealed in a regulatory filing the next day. Following the company’s abandonment of its high-stakes acquisition of Warner Bros. Discovery (WBD) assets earlier this year, this large buyback represents a strategic shift. 

This is a move coming in after turning down a $72 billion bid to acquire Warner Bros. Discovery’s assets, which the streaming giant Netflix was hoping for earlier this year.

In premarket trade, its shares increased by 1.5%.

The new buyback reflects a return to shareholder-focused capital returns now that Netflix is no longer setting aside funds for the multibillion-dollar Warner Bros. Discovery acquisition. The $25 billion adds to approximately $6.8 billion remaining from a December 2024 program, and the new authorization has no expiration date, giving the company flexibility in timing its purchases. In the first quarter of 2026, Netflix repurchased 13.5 million shares for roughly $1.3 billion.

Netflix’s walk away from the reported $72 billion deal for Warner Bros. Discovery’s studio and streaming assets in February 2026 after declining to match a superior bid from Paramount-Skydance. Upon termination, Netflix received a $2.8 billion breakup fee from Paramount-Skydance, softening the blow of the failed pursuit. Investors had originally reacted poorly to the WBD merger news due to debt concerns on Netflix’s part. However, Netflix shares dropped roughly 30% during the pursuit.

Following the announcement of the Warner Bros. merger last year, Netflix’s stock dropped by roughly 9%, but since the firm withdrew from the deal in February, it has increased by almost 10%.

Netflix has launched a number of expansion initiatives in the two months since abandoning its bid for Warner Bros., such as acquiring Ben Affleck’s AI film-tech company InterPositive, increasing subscription costs in the United States, and releasing a children’s gaming app.

In order to scale its ad-supported tier, which is thought to be crucial for future revenue growth, analysts anticipate that the business will emphasize growth areas including advertising, live content, and sports.

Netflix announced last week that its co-founder and chairman, Reed Hastings, will leave the company in June, along with a muted projection for the second quarter.

The business had previously stated that it intended to invest roughly $20 billion in movies and television this year in addition to resuming share repurchases.

According to Ross Benes, senior analyst at Emarketer, “Netflix’s buyback provides some answers on what it plans to do following its WBD breakup fee collection.” However, it still doesn’t fully indicate where the business will reinvest.

As part of its proposed $110 billion acquisition of Warner Bros. Discovery, Paramount Skydance agreed to pay Netflix a $2.8 billion termination fee.

The buyback announcement has helped stabilize Netflix’s stock, which had recently faced severe pressure following a tepid second-quarter forecast and the news that co-founder Reed Hastings will exit the board in June 2026. For 2026, Netflix plans to invest $20 billion in original content while shifting focus toward scaling its ad-supported tier and live sports programming, and the company aims to generate roughly $3 billion in ad revenue this year, doubling its 2025 performance.